Caterpillar Hints at Slowdown, Economic Report by Financial Site Profit Confidential

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Caterpillar Inc. has had a tremendous run since the fall low of $67.54 in October to a recent high of just over $116.00. Sasha Cekerevac, contributor to top financial e-newsletter and web site Profit Confidential, states that the stock is priced to perfection at current levels and could be in for a pullback.

caterpillar hints at slowdown, economic report by financial site profit confidential

Caterpillar Hints at Slowdown, Economic Report by Financial Site Profit Confidential

“Using a three-month rolling average on a year-over-year basis, the number of sales is decreasing, yet it’s still positive. If investors are anticipating growth like last year, this doesn’t appear to be happening,” says Cekerevac.

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Caterpillar Inc. has had a tremendous run since the fall low of $67.54 in October to a recent high of just over $116.00. Sasha Cekerevac, contributor to top financial e-newsletter and web site Profit Confidential, states that the stock is priced to perfection at current levels and could be in for a pullback.

In his recent article, Caterpillar’s Cracks Indicate an Economic Slowdown, Cekerevac highlights research he conducted into Caterpillar’s statistics of dealer sales showing a disturbing trend.

“Using a three-month rolling average on a year-over-year basis, the number of sales is decreasing, yet it’s still positive. If investors are anticipating growth like last year, this doesn’t appear to be happening,” says Cekerevac.

Cekerevac notes that part of the recent upsurge was pent-up demand, but he raises the point that future earnings guidance from the company might be below investor expectations.

“If we’ve already seen a huge build-up from clients, there is the distinct possibility that Caterpillar might guide downwards the market sentiment of investors,” says Cekerevac.

Cekerevac also notes that other companies in the space, such as Terex Corporation, could be hit harder. “Terex has a miniscule profit margin of 0.70%, versus 8.19% for Caterpillar,” says Cekerevac.

Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it “begged” its readers to get out of the housing market... before it plunged.

Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.

To see the full article and to learn more about Profit Confidential, visit http://www.profitconfidential.com.

Profit Confidential is Lombardi Publishing Corporation’s free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit http://www.profitconfidential.com.

Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi’s current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six.

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